Upload
lamtuyen
View
216
Download
1
Embed Size (px)
Citation preview
Useful Models for Organizational Strategy
© Luis A. Martinez 2016
2
Huh?
https://www.london.edu/faculty-and-research/lbsr/what-is-strategy-and-how-do-you-know-if-you-have-one#.WEmvdFwplvQ
Organizational (Oz) Strategy defined
What? How? Why?
Transformational Strategy – success stories
Evolving & Remaining Relevant over time
Some History
Structure and Culture
Assessment Tools and Process - it’s cyclical
Strategy spawns Tactical Plans
M&A Case Studies
The Future - Next Practices
Core Competencies and survival
Summary
Useful Models for Organizational Strategy
© Luis A. Martinez 2016
3
Useful Models for Organizational Strategy
Emphasis: Ed.
‘What’ of Strategy
“An expression of how an organization needs to evolve,
over time to meet its objectives along with a detailed
assessment of what needs to be done.”
http://www.businessdictionary.com/definition/organizational-strategy.html#ixzz3li5f2nVE
© Luis A. Martinez 2016
4
Useful Models for Organizational Strategy
Strategic Plans
What? • Course of action to achieve long-range goals, 1 to 5 years, or more.
• Reflecting company’s
• Direction,
• Purpose,
• Mission Statement
• Using data from finance, operations, competitive environment
© Luis A. Martinez 2016
5
“Management is doing things right;
leadership is doing the right things.”
Peter F. Drucker
Useful Models for Organizational Strategy
How?
Organizational Model - Assessment Tool
Five questions (Peter F. Drucker):
What is our mission?
Who is our customer?
What does the customer value?
What are our results?
What is our plan?
Dynamic dichotomy – establish but adapt.
Peter F. Drucker
© Luis A. Martinez 2016
6
Useful Models for Organizational Strategy
Emphasis: Ed.
How?
“Developing an organizational strategy for a business involves
first comparing its present state to its targeted state to define
differences, and then stating what is required for the desired
changes to take place.
http://www.businessdictionary.com/definition/organizational-strategy.html#ixzz3li5f2nVE
© Luis A. Martinez 2016
7
Strategic plans influence development
of tactical plans.
Useful Models for Organizational Strategy
© Luis A. Martinez 2016
How?
How will enterprise create long term value? • Scope: What activities will it participate in?
• Markets: What markets to address?
• Advantage: What are relevant competencies?
• Resources: What’s required to start up and compete?
• Environment: What are dynamic market factors?
• Stakeholders: Who are constituents affecting direction and activities?
Think Relevance
8
9 © Luis A. Martinez
2016
Useful Models for Organizational Strategy
Kongo Gumi
Since 578 AD Since 1136 AD
Why? To remain relevant.
Why OD?
Organizational Design seeks to:
• Integrate people, processes & technology towards business objectives
• Shape values, shared beliefs, norms of Ee’s
• Improve all communications (inbound / outbound)
• Optimize departmental interdependencies
• Identify / resolve quality & service delivery issues
• Improve business efficiencies
• Boost employee morale
• Enable customer satisfaction
• Remain relevant
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
10
Useful Models for Organizational Strategy
Business strategy must evolve over time
to meet its objectives
and remain relevant
© Luis A. Martinez 2016
From
Ma Bell
To 7 Baby Bells
1982
12
13 © Luis A. Martinez
2016
“Stay relevant, my friends.”
Useful Models for Organizational Strategy
Secret Sauce?
14 © Luis A. Martinez
2016
Useful Models for Organizational Strategy
Transformational Strategies
Nokia cell phone in your pocket?
How old is Nokia?
Transformational Strategies
15
Finland 1865
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
• Wood pulp
• Basic minerals
• Rubber tires
• Bicycles
• Washing Machines
• Radios
• Electronics
• #1 in Cell Phones 2005
What happened ???
250,000,000
Nokia 1110
1960
16 © Luis A. Martinez
2016
Useful Models for Organizational Strategy
Transformational Strategies
Nokia today
“Nokia acquired French company Alcatel-Lucent SA, the combination
making Nokia the second-largest player in the global networking sector.”
(Source: “Nokia Acquires Alcatel-Lucent, Integration to Start Soon,” Yahoo! Finance, January 5, 2016.)
$24,521,481,000. US Dollar
Why does Organizational Design and Development matter?
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
17
Dynamic, Evolving Nature of OD Historical Perspectives
Person / position perspective
Historical Paradigm - Person was position
Job-shop manufacturing
• Blacksmith, baker, barrel maker, seamstress
• Communication channels informal
• Obstacles to expansion?
• Examples today?
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
18
Industrial revolution’s paradigm shift • Mass production
• Interchangeable workers,
• Trained for specific tasks
• Communication becomes critical
Although complex, enabled fantastic growth
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
19
Oz Design History
Frederick Taylor - US: scientific management, “one best way” to accomplish tasks, time / motion studies
Henri Fayol, France - structures for greatest efficiency, chain-of-command
Max Weber, Germany - authority ascribed to position
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
Outcome- vertically integrated, ordered, disciplined, task oriented,
top-down structures
20
Influential writers - 50’s & 60’s Critical of prevalent top-down directive Oz
Alternatives - Maslow’s hierarchy of needs
Stressing employee self fulfillment, self actualization
Spawned Quality of Work Life movement to improve:
Business performance
Mission delivery
Business Growth
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
Abraham Maslow
21
Maslow’s Effect on Quality of Work Life? Your Examples
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
22
What about Structure?
“Organizational Structure refers to the way an organization [Oz]
arranges people and jobs so that its work can be performed
and its goals can be met.”
Reference for Business, Encyclopedia for Business, 2nd Ed.
Useful Models for Organizational Strategy
© Luis A. Martinez 2016
Key words?
24
20th / 21st Century
Organizational Structure Revolution
Think of:
• Functional
• Divisional
• Matrix
• R.O.W.E., Flatocracy, Holocracy, etc.
In common - Oz goals supersede individual interests
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
https://www.allbusiness.com/4-common-types-organizational-structures-103745-1.html/2
25
Does Oz structure drive corporate culture? If so, how?
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
26
27 © Luis A. Martinez
2016
Useful Models for Organizational Strategy
Corporate Culture Anthropologist
Organizational culture is
“A system of shared assumptions, values, and beliefs, which governs how
people behave in organizations. These shared values have a strong influence
on the people in the organization and dictate how they dress, act, and
perform their jobs. Every organization develops and maintains a unique
culture, which provides guidelines and boundaries for the behavior of the
members of the organization.”
http://study.com/academy/lesson/what-is-organizational-culture-definition-characteristics.html
Do all enterprises have an Oz culture?
Some Examples of Organizational
Structure and Culture
From: Family Owned –
• Family structure: socialism
• Culture of (farm, retail, restaurant, motel): tight
controls, task specialization, some delegation
• Small to medium: family controlled with professional
dedicated support staff
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
Since 1880’s Charles Corby Sr. and Jr.
Since 1930’s 28
Large private, incorporated or closely held
Wegman
Sands Golisano
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
Mary Catherine "Kitty" Van Bortel
Mann
What do we know about these cultures?
Dixon
Schultz
29
Global Entity – Large, publicly held, iconic leaders
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
30
Delegation?
Span of Control?
Empowerment?
Risk tolerance?
Results orientation?
Transaction driven?
Customer centric?
Organizational Culture – Compare & Contrast Characteristics
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
31
Organizational structure
Components
1. Chain of Command
2. Span of Control
3. Centralization
4. Specialization
5. Formalization
6. Departmentalization
Or degrees and reciprocals of each…changing over time
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
https://blog.hubspot.com/marketing/organizational-structure-building-blocks#sm.0000rraparjm6e43q2m1eumirc3ky
32
Choosing among tradeoffs -Your Choices?
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
33
President
VP
Operations
Plant Mgr A
Plant Mgr B
Plant Mgr C
VP
Info
Technology
VP Finance
Dir.
Purchasing
VP
Engineering
Dir Product
Development
Mgr.
Maintenance
VP
Sales & Mktg.
Traditional Oz Structure
Characteristics: Vertically oriented chain of command, limited span of
control, centralized, task specialized, top down formal authority,
bureaucratic, “one best way”
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
34
President
and
Creative Director
Media
Mind
Web
Architect
Accounting
Billing
Collections
Graphics
Guru
Head
Design Firm
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
Characteristics?
35
Departmentalization - Oz grouping basis •Functional
• Production, marketing, accounting, HR
•Geographic
• U.S., Western Europe, Pacific Rim
•Product
• Biomedical, digital, software, services
•Customer/Market
• Consumers, government, SOHO
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
http://www.referenceforbusiness.com/management/Ob-Or/Organizational-Structure.html
36
Functional basis - Examples
Manufacturing: production, marketing, accounting, sales, HR
Healthcare: Medical / surgical; finance; nursing; food service /
housekeeping; outpatient / ambulatory /emergent care, etc.
Advantage: Disadvantage:
Efficiency, effectiveness Narrow departmental focus
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
37
Geographic basis
Multi National Enterprises (MNE) Significant presence in:
•U.S., Western Europe, South America, Asia, Middle East
•Performing under regional management
•Local focus & market relevancy
•Labor supply / cost advantages
Advantage: Disadvantage:
Better coordination of activities Distance from main enterprise
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
38
Product basis •Product based - large diversified conglomerates grouped by product
similarity
•Procter & Gamble, GE, Unilever, General Mills
•Semiautonomous operations - biomedical, digital, software, services
Advantage: Disadvantage:
Product line focus, accountability Duplication of resources, redundancy
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
39
Customer/Market basis •Organized and co-located by type of customer served.
•Products directed to end consumers, large business, regional /
state / federal government, SOHO, utilities, healthcare
Advantage: Disadvantage:
Proficiency at meeting client
expectations
Duplication of resources, redundancy
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
40
Functional?
Geographic?
Product?
Customer/market?
Choosing among tradeoffs -Your Choices? Why?
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
41
Useful Models for Organizational Strategy
© Luis A. Martinez 2016
“What got you here won’t get you there.” - Marshall Goldsmith
42
Useful Models for Organizational Strategy
Strategic Plans
How?
Six Steps
1. Current state
2. Desired state
3. Define Gap
4. Plan your work
5. Work your plan
6. Repeat
© Luis A. Martinez 2016
© Copyright: Luis A. Martinez 2011
43
Useful Models for Organizational Strategy
© Luis A. Martinez 2016
Beware of Linear Models!
Life is not linear.
It’s cyclical, asymmetric, with out of control spirals…
Start here: Success!
Example: DMAIC
44
Organizational Model - Assessment Tool
• Systematic process to:
• Gather information about Oz
• Diagnose specific problems
• Develop solutions
• Tool Sample
• 360 reviews
• Employee satisfaction surveys
• Employee meetings
• Employee ombudsperson
Useful Models for Organizational Strategy
© Luis A. Martinez 2016
45
Useful Models for Organizational Strategy
How?
Tactical Plans
Actions to achieve short-term goals (within fiscal year)
• Aligned to achieve strategic, longer-term goals
• Explain Business Units deliverables, resources, accountabilities
• Shorter time frames, narrower scopes
• Strategic and tactical plans - inseparable
Enterprise success relies on tactical plans
building on each other to achieve strategic plan.
© Luis A. Martinez 2016
46
Desired outcome – Corporate Agility
• Alignment of: • Roles
• Responsibilities
• Accountabilities
• Within supportive Oz design
• In anticipation of disruptive technology, global developments!
• Deploy - Business Disruption Plan/Business Continuity Plan
Useful Models for Organizational Strategy
© Luis A. Martinez 2016
Why? To remain relevant.
47
Does Mission drive much of Oz culture & design?
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
48
Oz culture pivots on mission -
What is business mission?
• Investment banking / finance?
• Community service?
• Manufacturing?
• Professional services?
What do each imply for Oz culture??
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
49
Oz culture pivots on mission -
What is business mission? • Healthcare (acute)?
• Technology development & transfer?
• Property / casualty / life / health insurance?
• Local / county / state / federal government?
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
50
Understanding Oz Models - What works?
Key to success – Balance
• Aligning functions, enhancing interdependencies
• Productive Tension – doers vs. checkers
• Balanced matrix • Senior leadership team
• Operations management
• Staff
• Employees
• Community stakeholders
• Shareholders
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
51
How to strike balance? • Different for every company
• Different within each division / organization
• Highly determined by corporate culture
• Changes over time!
• Often derived from CEO or founder / icons • Sam Walton
• Freddie Smith
• Michael Dell
• Robert Wegman
• Tjerk de Ruiter
• Lauren Dixon
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
52
How does culture affect success of M&A?
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
53
M&A Case Study - Manufacturing model Exide Battery Corp. – low tech manufacturing multinational
• Closely held (Art Hawkins, CEO at 10%)
• Traditional pyramid, autocratic, volatile, resilient
• Maverick / cowboy culture (expected & prized!)
• Near Chapter 11 in 1985, acquired competitor May 27, 1987
• HR: turbulence – resurgence
• From Country Club to lean culture
• Turned around Exide Puerto Rico
• Grim Reaper to Santa Claus
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
54
Case Study - Healthcare: Lehigh Valley Hospital
Merger of two competing community hospitals
• Old facility high touch - downtown • Maternity ward
• Outpatient clinics
• Psychiatry
• New facility high tech - suburban • Open heart
• Trauma center / Medevac /intensive care
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
55
Merger objective: Integrate cultures •Process: Acquisition Integration - leverage cultures
•Identify best of each culture
•High Touch, face to face, accessible
•‘Round clock’ employee meetings
•Collaborative community gatherings
•In common – very high work ethic!
•Surrounded by unions
Today? #80 in Top 100 Best Places to Work
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
56
57 © Luis A. Martinez
2016
Useful Models for Organizational Strategy
“Concepts such as agile manufacturing, just-in-time inventory
management, and ambidextrous organizations are impacting managers'
thinking about their organizational structure.”
The Future?
http://www.referenceforbusiness.com/management/Ob-Or/Organizational-Structure.html
Artificial Intelligence:
“Your smartphone, your car, your bank, and your house all use artificial
intelligence on a daily basis…AI is everywhere, and it’s making a huge
difference in our lives every day.”
http://beebom.com/examples-of-artificial-intelligence/
What’s #1 occupation?
58 © Luis A. Martinez
2016
Useful Models for Organizational Strategy
R.O.W.E Results Oriented Work Environment http://workplaceflexibility.bc.edu/types/types_arrangement_results
Flatarchies
Self Managed Organizations
Holacracy http://www.tuw.edu/business/alternative-organizational-structures/
The Future?
Useful Models for Organizational Strategy
Jan Koum
Founder
What’s App
© Luis A. Martinez 2016
Fred Smith –
Founder
FedEx
1 billion monthly active users
59
Disruptive innovation
and Next Practices http://www.claytonchristensen.com/key-concepts/
Useful Models for Organizational Strategy
© Luis A. Martinez 2016
“Only the paranoid survive” - Andy Grove
“There’s something just over the horizon
that will put us out of business.
What is it?” © Copyright: Luis A. Martinez 2011
60
Useful Models for Organizational Strategy
© Luis A. Martinez 2016
Failing to Anticipate and Adapt
Core Competencies
61
What did Kodak do after inventing digital camera?
Kept cashing checks for chemical film revenue, until…
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
“Cannibalize thyself, lest ye be cannibalized.” - Anonymous
62
Useful Models for Organizational Strategy
“There are few corporate blunders as staggering as Kodak’s
missed opportunities in digital photography, a technology that
it invented. This strategic failure was the direct cause of
Kodak’s decline and destroyed its film-based business model.”
- Chunka Mui, Forbes, 2012
© Luis A. Martinez 2016
63
“Best way to manage change is to anticipate it.” © Copyright: Luis A. Martinez 2011
© Luis A. Martinez 2016
Useful Models for Organizational Strategy
Follow the money - What did Xerox do? After inventing Personal Computer, Laser, mouse, GUI, Object Oriented
Programming, WYSIWYG - and The Internet ?
Kept cashing checks for analog copiers, until…
64
What We Learned Organizational (Oz) Strategy defined
What is it? How to do? Why bother?
Transformational Strategies that worked
Importance of remaining relevant over time
History
Structure and Culture
Variety of assessment tools - it’s cyclical, not linear
Strategy & Tactical Plans - inseparable
M&A Case Studies
From ubiquity to - what’s next?
Recalibrating Core Competencies - for survival
References
Useful Models for Organizational Strategy
© Luis A. Martinez 2016
65
Stay relevant, my friends…
Remember!
Useful Models for Organizational Strategy
© Luis A. Martinez 2016
66
Keith Richards
Sources and References: Avery, Jim: How Xerox Invented the Information Age and Gave it Away, Cracked,
http://www.cracked.com/article_18807_how-xerox-invented-information-age-and-gave-it-
away.html
Deloitte Consulting, LLC, Boosting Business Performance Through Organization Design,
2008
Distelzweig, Howard and Droege, Scott B. Organizational Structure,Reference for
Business,Encyclopedia of Business, 2nd Ed.
Friedman, Thomas; The World is Flat – a Brief History of the Twenty-first Century, Farrar,
Straus and Giroux, New York, 2006
Grossman, Robert; New Competencies for HR, HR Executive, June 2007
Leader to Leader Institute: Drucker Foundation Self Assessment Tool, 5 Questions:
http://www.pfdf.org/tools/sat/questions.html
Marshall, Gordon; Organizational Design Movement – A Dictionary of Sociology, 1998.
Useful Models for Organizational Strategy
© Luis A. Martinez 2016
67
Luis A. Martínez, M.Ed.
What can I do for you?
Human Capital Strategy Partners PO Box 242 • Pittsford, NY 14534 • [email protected]
NEW YORK | MIAMI | DENVER
(585) 766-9536
www.HumanCapitalSP.com
@IAmLuisMartinez
Books available on Amazon.com
70